I’d be a bum on the street with a tin cup if the markets were always efficient.
- Warren Buffett

The fact that people will be full of greed, fear or folly is predictable. The sequence is not predictable.
- Warren Buffett

These are just two of many Buffett gems found in this collection of Buffett quotes.

I found a great post over on DoughRoller.net comparing the investment value of Berkshire Hathaway stock versus a mutual fund. Although the popular holding company run by Warren Buffett may seem a lot like a mutual fund, there are some fundamental differences that can make Berkshire Hathaway the better investment.

Many people hear about Berkshire Hathaway and immediately think “I can’t afford that stock.” That’s poor financial thinking, because the actual price of a stock has very little relation to the value of the company or whether or not you should be buying it. Although the Berkshire Hathaway A shares make the headlines with their six figure price per share, there is also a B share option that is exactly the same as the A shares but 1/30th the price. It’s basically a smaller piece of the same pie.

The main reason that Berkshire Hathaway is better than a mutual fund is the low cost. There’s no 1% (or more) fee that you’ll see on almost all mutual funds on a stock like Berkshire. The costs of running Berkshire for a year are less than 1/100th of 1% the value of the company.

Other factors that make Berkshire a good investment are taxes (no dividends from Berkshire mean no taxes until you sell the stock) and the diverse selection of companies owned by the holding company. Sure, they tend to not own those fast-rising internet stocks that also tend to crash back down to earth in short time, but the companies they do own range from insurance to newspapers to steel makers to Coca Cola. A little bit of everything, and only the companies that some of the best investors in the world agree are long-term money makers.

Here’s a link to the DoughRoller post.

Warren Buffett has rode the waves of wise investments back to the #1 spot on Forbes annual list of the world’s richest men. His personal wealth grew by $10 billion last year, from $52 billion to $62 billion. Mexican telecom mogul Carlos Slim came in second place with $60 billion in personal assets. Bill Gates is down to #3 after spending the past 13 years at #1.

Buffett announced last year that he would be donating the majority of his accumulated wealth to the Bill & Melinda Gates Foundation, a charity that funds major projects around the world - most of them health related.